QuickBooks Online vs Desktop: Which Is Right For You?

Deciding which version of QuickBooks is right for you can be confusing. If you’re a product based business with complicated inventory needs, you should go with QuickBooks Desktop. However, if you’re a service-based business or one that needs access from multiple computers, then QuickBooks Online is your best choice.

While desktop has more features, QuickBooks Online is always adding new features and frequently running promotions where you can save up to 50%.

QuickBooks Online is your ideal solution if you are a service-based business that does not need inventory tracking options or does not have complicated invoicing requirements. QuickBooks Online is best for companies that want access from multiple devices, have more than one person who needs access, as well as those that desire automatic updates from the cloud.

You should ultimately consider QuickBooks Online if you want the following:

Ability to give your accountant or other users access from any location: QuickBooks Online allows you to set up a user id and password for each person who needs to access your data from wherever they are located.

Ability to enter transactions using a mobile device, PC or a Mac: QuickBooks Online does not require software installation. Therefore, you can just open up a web browser from your mobile device, PC or Mac and log right into your account to quickly access your data.

Automatic, real-time updates: As you make changes to your data, QuickBooks Online updates automatically. Whether there is one person in the QuickBooks file or multiple users, changes made are updated in real-time.

QuickBooks Desktop is generally the best solution if you are a product-based business that needs inventory tracking options and batch invoicing. There are also industry-specific desktop versions that are great for contractors, manufacturers, wholesalers, retailers, and more. However, the desktop version can only be accessed from one device.

You should ultimately consider QuickBooks Desktop if you want the following:

Multiple inventory tracking options: QuickBooks Desktop offers two options for tracking inventory – the average cost method or the FIFO method (FIFO method available when you purchase the Advanced Inventory add-on module.). QuickBooks Online only allows inventory tracking using the FIFO (First In First Out) method.

Batch invoicing: QuickBooks Desktop has batch invoicing capability. When the amount and type of service you are billing multiple clients are the same, this feature allows you to invoice them all at the same time.

Industry-specific versions: QuickBooks Desktop offers industry-specific features for businesses that fall into one of the following industries: General Business, Contractor, Manufacturing & Wholesale, Professional Services, Retail & Nonprofit. QuickBooks Online does not offer industry-specific features.

QuickBooks Online vs Desktop Primary Differences

1. Software Installation

QuickBooks Desktop requires you to download software onto your computer, which also means that you are not able to access the program when you are not at your desk. QuickBooks Online does not require installation and can therefore be accessed anywhere with an internet connection (including your mobile phone).

2. Automatic Online Backup and Protection

QuickBooks Online data is automatically backed up and secured by Intuit’s servers. QuickBooks Desktop data is not automatically backed up. You will need to create a backup plan and set it up on your own.

3. Access Data From Multiple Platforms

QuickBooks Online data can be accessed from a PC and Mac. QuickBooks Desktop data is only accessible from a PC or Mac, depending on which version of QuickBooks you are using.

4. Access Data From Anywhere at Anytime

QuickBooks Online data can be accessed by users in different locations at the same time – no reason to transfer files back and forth. QuickBooks Desktop data can be accessed by multiple users in different locations only with the purchase of hosting services.

5. Unlimited Free Technical Support

With QuickBooks Online, you can contact technical support as much as you like at no additional charge. QuickBooks Desktop support is free for the first 30 days after you install the software. After 30 days, you will have to purchase one of the support plan packages.

6. Automatic Access to the Latest Version of QuickBooks

With QuickBooks Online, you have immediate access to the latest version of the software. QuickBooks Desktop requires that you purchase the latest version of the software to gain access to new product features.

7. Sample Company File Test Drive

With QuickBooks Online, you’ll get access to a sample QuickBooks Online company file that already has QuickBooks data in it. You are able to navigate through the program and practice entering transactions.

Desktop is a little different. Once you download your free trial of QuickBooks Desktop; you will have access to several sample company files for multiple industries. You can practice entering transactions without using your own company file.

8. Multiple Inventory Tracking Options

QuickBooks Online allows inventory tracking using the FIFO (First In First Out) method only. QuickBooks Desktop offers two options for tracking inventory: the average cost method or the FIFO method (FIFO method available when you purchase the Advanced Inventory add-on module.)

9. Batch Invoicing

QuickBooks Desktop has batch invoicing capability. This feature allows you to invoice multiple customers at the same time. QuickBooks Online does not offer this feature.

10. Industry-Specific Versions Available

QuickBooks Desktop offers industry-specific features for businesses that fall into one of the following industries: General Business, Contractor, Manufacturing & Wholesale, Professional Services, Retail & Nonprofit. QuickBooks Online does not offer industry-specific features.

QuickBooks Online vs Desktop Pricing

QuickBooks Online (QBO) is a monthly subscription that runs between $15-$50, whereas Desktop is a one-time cost between $299-$1100. At first glance, you might think QBO costs more than desktop; but remember that you always have access to the latest features of QBO without upgrading; to access new desktop features you must pay to upgrade your software.

QuickBooks Online is not like QuickBooks Desktop where you make a one-time payment in full for the product. As you can see from the chart, the 3 plans differ not only in retail cost and number of users but also in the following 2 key areas:

Accounts Payable: the ability to enter and pay bills is only available with the Essentials and the Plus subscriptions. It is not available with Simple Start.

Inventory: tracking and managing inventory is only available in the Plus subscription. It is not available for Simple Start or Essentials.

*Note: Although Quickbooks Desktop is a one-time purchase, you will need to purchase an upgrade at least every 3 years to continue using Quickbooks support, Intuit Payroll, and Intuit Merchant Services.

QuickBooks Premier and Enterprise offer industry-specific versions of QuickBooks. Enterprise allows you to include up to 30 users, which makes it suitable for medium-sized or fast-growing small businesses. If your business falls into one of the following industries, you should consider purchasing one of these QuickBooks Desktop products in order to take advantage of the industry-specific features that are not available in QuickBooks Pro or QuickBooks Mac:

General business

Contractor

Manufacturing & Wholesale

Professional Services

Retail

Nonprofit

QuickBooks Mac and Pro offer similar features. The primary differences between them are the maximum # of users and the platform that they operate on (Pro operates on PC; Mac operates on Mac). I recommend these two products to most small businesses because when compared to similar products you can’t beat the features these products offer for the price. Unfortunately, Intuit has decided to discontinue QuickBooks Mac which we will discuss next.

Discontinuation of QuickBooks Mac Desktop

Intuit has recently decided to discontinue QuickBooks Mac but will continue to support the 2016 version through May 31, 2019. If you are currently using QuickBooks Mac, we recommend you consider switching to QuickBooks Online. If you need inventory and 1099 tracking, go with QuickBooks Online Plus; otherwise, go with QuickBooks Online Essentials. Check out QuickBooks Online Comparison to learn more about the features included in each subscription.

Ease Of Setup: QuickBooks Online vs Desktop

One of the great things about QuickBooks (both Desktop and Online) is that you don’t have to be an accountant in order to set up or use the program. Whether you are using QuickBooks Online or QuickBooks Desktop, this process should take no more than 20 minutes to complete; provided you don’t have any historical information to bring over.

Importing Your Bank Account Transactions to QuickBooks

Once you have completed the initial setup, both QuickBooks Online and QuickBooks Desktop allow you to download your banking transactions from your bank’s website directly into your QuickBooks account. In my experience, this process is a lot quicker to do in the Online product than it is in the Desktop version.

Setting Up Your Company

The company file setup process is basically the same for both QuickBooks Online and QuickBooks Desktop. The express setup takes about 5-10 minutes and requires just some basic company information. The more in-depth setup may take about 1-2 hours, depending on whether or not you are bringing data over from another accounting system.

In addition to providing basic company information, you will need to answer a few questions about how you will manage your business. I recommend you spend the few extra minutes up front and complete the in-depth setup process. The more in-depth setup process will provide you with a more customized company file setup that will meet your specific business needs.

Ease Of Use: QuickBooks Online vs QuickBooks Desktop

Both QuickBooks Online and QuickBooks Desktop are very user-friendly. Prior to 2013, I would not have said that about QuickBooks Desktop. However, in 2013 there were some major changes to the QuickBooks Desktop interface which made it much more user-friendly than it had been in previous versions. This was partly due to the fact that the online version was a much cleaner, easier program to navigate, and Intuit decided to apply some of those same features to their legacy desktop product.

Both QuickBooks Online and QuickBooks Desktop products include the following user-friendly features:

Organized menus that allow you to quickly find what you are looking for:

If you are currently using QuickBooks Desktop, the same QuickBooks terminology will translate to QuickBooks Online. However, you will have a bit of a learning curve when it comes to navigating within the program since it is very different from QuickBooks Desktop. If you have never used QuickBooks, you will most likely get up-to-speed pretty quickly on either product that you choose.

Customer Support: QuickBooks Online vs Desktop

In-Product Help

In-product help options are resources available within both QuickBooks Online and QuickBooks Desktop under the Help menu:

Knowledge Base (Help menu) – This is one of my favorite resources because it’s the quickest way to get answers to questions like, “How do I enter a check?” or “How do I create an invoice?”

Video Tutorials – a library of videos that you can access from the Help menu. These videos provide a quick way to visualize step by step how to do something in QuickBooks. They typically run between 1-10 minutes long.

Be sure to check out 39 Free QuickBooks Online Tutorials by Fit Small Business. This is a free course that includes both video & written step by step instructions. Best of all, it’s free!

Phone & Chat Support

Phone/chat support is available for both QuickBooks Online and QuickBooks Desktop. Unfortunately, the quality of support that you receive may not always be good. I have had better results with chat support than I have with telephone support. In addition, support for Online is always free. Desktop support is only free for the first 30 days. After 30 days, you will have to purchase one of the support plan packages.

Here are a couple of situations to help you determine whether to use chat support or telephone support:

If you’ve encountered an error message that is preventing you from using your QuickBooks file then I would call the support line for assistance.

If you’ve got a billing question then I would use chat support.

Certified Advisers

Certified QuickBooks ProAdvisors are accounting professionals who have certified in one or more QuickBooks products. There are a number of ProAdvisors who do not like the QuickBooks Online product and therefore do not support it. You will find more ProAdvisors that are certified in the QuickBooks Desktop product line than QuickBooks Online.

ProAdvisors are not Intuit employees. They are independent contractors and depending on experience, will generally charge $25/hr & up for their services. The more education and experience they have, the more they will charge.

With that in mind, I recommend hiring a ProAdvisor for the following types of services:

To review your company file setup prior to entering transactions.

To provide face to face training on how to properly use QuickBooks

To perform a periodic review of your financial statements. I recommend you set this up on a monthly or quarterly basis.

If you’d like to try QuickBooks Online before you buy it, you’ve got a couple of options:

1. Go for a Test Drive

This will give you access to a sample company file that already has QuickBooks data in it. You are able to navigate around the program and practice entering transactions like invoices and checks. Once you close out of the file, it does not save your work. To access the test drive, click here and follow the on-screen instructions.

2. Sign Up For a 30-Day Risk-Free Trial

After 30 days, you can subscribe by simply providing your billing information

If you decide not to subscribe you will have read-only access to your data for 90 days after the trial period has ended.

Since QuickBooks Online is a cloud-based product, there is no software to install. If you don’t need to try a trial and are ready to get started with QuickBooks Online, just click here. To get your business up and running quickly, check out our free QuickBooks Course. It includes step by step instructions to help you get your business set up in no time.

QuickBooks Desktop does offer a free trial option. You can sign up here to access a full version of QuickBooks Enterprise for 30 days. Remember, if you do purchase QuickBooks Desktop or QuickBooks Online and later decide that it is not the right solution for you, there is a 60-day money back guarantee.

QuickBooks Online vs Desktop: Which Is Better?

There has been (and continues to be) a debate as to whether or not the cloud version of QuickBooks is better than the desktop version. The desktop version has been around since the 1990s, long before software over the Internet was common. Currently, QuickBooks Desktop has a few more features and functionality when you compare it to the online version.

However, new features are constantly being added to the online version and there are features available in online that are not available in desktop, like giving access to multiple users so they can access your data from anywhere in the world.

Unfortunately, many bookkeepers and CPAs have chosen not to embrace the online version. In my opinion, this is a mistake. As a result, many small businesses who recognize the fact that the cloud is the future not only for QuickBooks but for most software used in business like Microsoft Office are having to replace their accountant/bookkeeper.

The most important thing that you can do is to select the software that will work best for your business. Based on your list of nice to have vs. need to have features, which product is going to work best for your business? Whether you go with the online version or the desktop version, it’s important to find a QuickBooks Pro who is certified in QuickBooks so that you can be confident your books are in the hands of an expert.

Bottom Line: QuickBooks Online vs Desktop

Whether you decide to purchase QuickBooks Desktop for its extensive inventory tracking capabilities or QuickBooks Online for its ease of use, you won’t regret it. QuickBooks Desktop and QuickBooks Online are both great products that millions of small business owners rely on every day to keep track of their day to day finances.

About the Author

Crystalynn Shelton

Crystalynn Shelton is a CPA and staff writer at Fit Small Business, specializing in small business Bookkeeping, Accounting, and Taxes. She is also an Adjunct Instructor at UCLA Extension where she has taught hundreds of small business owners how to setup and manage their books using QuickBooks for 8 years. Prior to joining Fit Small Business, Crystalynn was a Senior Learning Specialist at Intuit for 3 years and also ran her own QuickBooks consulting and training business. When Crystalynn isn’t writing or teaching, she enjoys rollerblading in Venice Beach and reading a good book.

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Comments (82)Disclaimer: Reviews on FitSmallBusiness.com are the product of independent research by our writers, researchers, and editorial team. User reviews and comments are contributions from independent users not affiliated with FitSmallBusiness.com's editorial team. Banks, issuers, credit card companies, and other product & service providers are not responsible for any content posted on FitSmallBusiness.com. As such, they do not endorse or guarantee any posted comments or reviews.Post Your Comment

Hello Crystalynn Shelton
My name is karamjit gill. My Husband has business in construction. He has two different companies for roofing and siding. I do the payroll for them and print invoices. Which would you recommend online or desktop. He usually has 5 to 10 employee and some subcontractors. I also want to know for desktop version does it keep tax table up to date or i need to do it manually.

Without knowing everything your husband uses QuickBooks for it is difficult for me to tell you whether Desktop or Online will work best for you. After reviewing the comparison chart in the QuickBooks Online vs. Desktop article, is there anything that your husband needs to do that you didn’t find listed on either Online or Desktop? If not, then I would recommend the Online version for the flexibility to access your data (like payroll) from anywhere.

As far as payroll is concerned both Desktop and Online manage payroll very well. With both versions, you must sign up for a payroll subscription. The subscription gives you access to updated payroll tables which you will just have to download as often as you receive a notification (generally every 3 months or so).

My brother is just starting his AC & Heating business and just purchased the Quickbooks software to put on his computer. The only inventory I can imagine him using is for the parts he would have to replace/install.
I am wondering if the Desktop version is good or would the online version be better for him.
Thank you for any information.

That is a great question. It’s difficult for me to tell you which product would be best without knowing all of the products and services that your brother sells in his AC & Heating business. However, if we just stick with mostly services for installation and repairs then I think QuickBooks Online would be fine. If he wants to keep track of the parts that he uses for each job he can do that with the QuickBooks Online Plus plan. However, if he purchases those items as needed and does not really need to keep track of them in inventory then QuickBooks Online Essentials should work just fine.

I would not recommend the Simple Start plan, it’s too limited for his business. Last but not least, QuickBooks offers a 60 day money back guarantee on desktop products so if you are within this time frame you should be able to get a refund for the software you purchased.

Hi Crystallyn
I own a small hair salon, no employees if I do hire they will be 1099. I need a Quick books for my accounting, not sure if I should buy online or desk top for Mac ?
I read that Intuit discontinued desktop version for Mac and would only support through 5-2019 is that true?
Which version do you think I should buy?

I recommend that you buy QuickBooks Online. It is true that the Mac version is going away and Intuit will no longer support it after after May 2019. Besides, QuickBooks Online is a much better product and since it is in the cloud it will work on any operating system – PC or Mac. Now the next decision you need to make is which edition of QuickBooks Online to purchase. I’ve written an article that compares the 3 subscriptions side by side. Check it out below:https://fitsmallbusiness.com/quickbooks-online-comparison/.

Hey Crystalynn
I have a start up manufacturing business that will be introducing 3-6 products and then 2 new products every quarter. We will be manufacturing the product ( subbing out for first year most items and using cash to facilitize as the business grows). Obviously I will need to create a BOM for each product. It seems like desk top makes the most sense. I don’t believe I will need multiple inventory methods atleast for 3-4 years. I like the flexibility of the online version and have used in another life but not for manufacturing. Would like your thoughts on the best approach.
Thanks
Denny
PS I have installed 4 different MRP systems in my life time and do not relish doing another. In fact we will use a pure visual pull system for inventory management and verification of orders and vendors pulls. That said we will still need structured bills for cost, inventory valuations, etc.

Hi Denny! I agree with you 100% that Desktop is the way to go. In my opinion, QBO does not currently have all of the functionality needed to set up and run a manufacturing business. I recommend that you purchase QuickBooks Premier – Manufacturing & Wholesale. I have provided a link below which should provide you with the current promotional discounts being offered.

You have your heading titles reversed for QB Online vs Desktop! Online REQUIRES internet, has a monthly fee, can be accessed from any device- please correct this info- because to a new subscriber it is very misleading and incorrect.

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